Oil rises above $60 on signs Asia growth reviving

Oil prices climbed back above $60 a barrel Tuesday in Asia on signs the region be may emerging from an economic slump.

Benchmark crude for August delivery was up 70 cents to $60.39 a barrel by late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. On Monday, the contract fell 20 cents to settle at $59.69.

Singapore said Tuesday its economy surged an annualized, seasonally adjusted 20.4 percent in the second quarter, adding to hopes that Asia could lead the world out of recession and fuel crude demand.

Crude prices have flirted with $60 a barrel for the last few days - pausing after a drop from an eighth-month intraday high of $73.38 on June 30 - as concern about a struggling U.S. economy undermined investor optimism.

"There's evidence that Asia, led by China, is turning around quite quickly," said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. "That's where the demand growth potentially will be."

Singapore was the first major Asian country to report second quarter gross domestic product. China, the world's third-largest economy, is scheduled to announce GDP later this week.

Moore said crude will likely average about $60 a barrel in the third quarter as signs of economic recovery in Asia are offset by weaker results in the U.S. and Europe.

"We might see quite strong GDP from China, and then some U.S. data that's pretty subdued," Moore said. "I think that's the game we're in for during the next few months."

An attack by Nigerian militants on oil installations in Lagos also bolstered prices. Rebels set fire to an oil depot and loading tankers on Sunday, killing five people in the group's first attack outside the southern oil-rich Delta region.

In other Nymex trading, gasoline for August delivery rose 1.66 cents to $1.66 a gallon and heating oil gained 1.52 cents to $1.519. Natural gas for August delivery jumped 7.3 cents to $3.34 per 1,000 cubic feet.

In London, Brent prices rose 77 cents to $61.45 a barrel on the ICE Futures exchange.